BPCL seeks 120KT April-June low-sulphur fuel oil

SINGAPORE, Mar 29 (Reuters) Bharat Petroleum Corp. Ltd. (BPCL) has issued a tender seeking 120,000 tonnes of low-sulphur fuel oil (LSFO), or low-sulphur waxy residue (LSWR) for April-June delivery, traders said on Thursday.

The four 30,000-tonne cargoes, of 0.2 percent sulphur for LSWR and 0.3 percent sulphur for LSFO, are for April 28-June 8 delivery to Mumbai on a cost-and-freight (C&F) basis.

The tender closes on April 2 and will remain valid till a day later.

This is the second time that BPCL , which is buying on behalf of India's largest independent power producer Tata Power, is seeking low-sulphur cargoes.

Traders said the requirement would boost a lacklustre LSFO market that had seen premiums stuck at low levels of around - a tonne to Singapore spot 180-cst quotes.

Demand from Japan, the product's largest buyer, has been dull since end-2006 amid a warmer-than-usual winter and steady power generation from its nuclear plants.

South Korean demand has also fallen since the winter season, with imports of medium-sulphur fuel oil halving since utilities bought February-delivery cargoes.

Earlier this month, BPCL bought its first parcel on Tata Power's behalf -- a 30,000-tonne lot of 0.2 percent sulphur LSWR for March 25-April 3 delivery to Mumbai -- from BP at an undisclosed price.

BPCL is the main supplier of low-sulphur fuel oil (LSFO) for power generation to Tata as it is the only refiner that has a pipeline connection to the utility's plant in Mumbai.

Previously, Tata, the largest power generator in Mumbai with an installed capacity of 1,798 megawatts (MW), had issued its own tenders when it requires spot fuel oil supply.

Last year, it bought at least 150,000 tonnes from the spot market, with the last parcel delivered in October/November.

REUTERS CS GC1117